Sharon said the creation of “security separation” was necessary to keep this week’s spiraling violence from leading to “total war.”

“We decided to start immediately and put in obstacles,” he told a news conference after delivering a major speech on Israeli TV.

He did not elaborate. But a top Israeli official told The Post:

* The plan approved by Sharon’s Cabinet would set up a thin buffer “a couple of kilometers wide.”

* The zone would stretch down what was the eastern border of Israel at the time of the 1967 Six-Day War, from Mount Gilboa to the region of Mount Hebron.

* It would be marked off by concrete and cement blocks very soon and probably buttressed by a fence along at least part of it.

Other “obstacles” would be placed on the borders of the buffer to make it difficult for terrorists to cross into Israel from the West Bank, the official said.

In his speech, Sharon also said he is prepared to meet with Palestinian leaders and eventually begin negotiations – but he also demanded an end to 17 months of bloodshed.

He insisted on “complete disarmament of the Palestinian areas” – which he said was “a condition for climbing out of the pit.”

Palestinian reaction was immediate and negative.

Palestinian Cabinet Minister Nabil Shaath said Sharon had “offered no hope, no complete suggestions, and opened no way to ending the confrontation and heading back to the peace table.

“If separation is intended to stop suicidal missions, it has failed,” he said.

“If it’s intended to stop trade and communication between the two peoples, it has succeeded to the misery of both.”

Sharon’s speech came at the end of a second day of sweeping Israeli retaliatory action.

Israeli warplanes attacked Yasser Arafat’s office and other Palestinian targets. At least nine Arabs died in the attacks and gun battles.

The attacks stretched from before dawn to midnight and included missile assaults on Palestinian naval police at the Rafah refugee camp and an office of Arafat’s presidential guard, Force 17, in Gaza City.

Palestinian sources said yesterday’s victims included four Palestinian civilians and an Israeli Arab.

In one incident, Israeli forces shot dead a gunman who opened fire and wounded two soldiers near an army post in the West Bank.